PORTLAND, Ore. (KOIN) — Oregon Gov. Tina Kotek has rescinded her proposal for an additional $1 surcharge on the sale of distilled spirits.
Since 2009, the Oregon Liquor and Cannabis Commission has renewed a 50-cent surcharge on each bottle of distilled spirits. Earlier this year, the commission considered doubling the surcharge after Gov. Kotek proposed it in her 2023-2025 budget plan.
The plan projected that the increased alcohol tax would generate $45.2 million more in General Fund revenues that could go toward battling Oregon’s addiction crisis.
During OLCC’s monthly meeting in April, advocates for addiction recovery organization Oregon Recovers argued that “pricing is prevention,” and the surcharge would be a preventative measure for binge drinking.
On the other side, the president and CEO of Oregon company Hood River Distillers said the surcharge would hinder distilleries across the state that have already faced supply chain challenges and employee shortages among other issues.
After receiving feedback from the public, OLCC’s Board of Commissioners was slated to vote on the proposed tax during its meeting this June.
However, on Thursday afternoon, Gov. Kotek wrote a letter to the commission asking them to reconsider doubling the surcharge. According to the governor, two new revenue forecasts that have been issued since her budget plan indicate that there will be enough funding for “essential services.”
“Additionally, I have been clear that I only support a new surcharge if the funds are directly allocated to behavioral health services,” Gov. Kotek said in the letter. “Without further specific action by the legislature this session, any surcharge approved by the Commission would go into the General Fund with no designated purpose, undermining the purpose of the recommendation.”
The governor says she will continue to speak with the OLCC on how to support mental health and addiction services across Oregon.
